Shenzhen Kaifa Technology (Kaifa) announced its LED subsidiary Kaistar will be acquiring 100% shares of a major U.S. LED company for US $130 million recently, reported China’s Securities Daily.
Following the announcement, Kaistar resumed trade on China’s bourse on Monday.
Kaifa has a 47.88% stake in Kaistar, which mostly manufactures LED epiwafers, LED chips, LED package and other LED lighting applications. The company intends partner up with a strategic investor to spend US $ 130 million to fully acquire the targeted U.S. LED manufacturer.
Although, Kaistar’s parent company has not revealed the U.S. LED manufacturers’ name, Cree can be ruled out. Kaifa revealed the U.S. company it intends to merge with is a LED chip, LED package and light module manufacturer. The U.S. company currently has more than 750 patents in LED chip and package patents, and has cross-licensed patents with Cree. Indicating the U.S. company products are patent-protected across the globe. The leading U.S. LED manufacturer is in the same league with Cree, Philips, and Citizen in the high power LEDs and package technology. The company has established sales relationships with more than 200 companies worldwide.
If Kaifa successfully acquires the U.S. LED manufacturer, Kaistar would have control over the acquired companies’ patents, which can be cross-licensed. In addition, the company would be able to vertically integrate the R&D process for key LED technologies ranging from GaN-on-Si wafers, LED chips, wafers, LED package, white light and optoelectric design. If the merger is successful, Kaistar would also be able to expand its business and gain access into Europe, U.S., Japan, Korea and other high-end LED supply chains.
This is not the first time that Kaifa has shown interest in acquiring a U.S. LED manufacturer, according to LEDinside editorial team’s research. In 2012, Kaifa intended to become U.S. LED manufacturer Bridgelux’s fourth largest shareholder by investing US $25 million to acquire a 7% stake in the company. Coincidentally, several paragraphs describing Bridgelux in the 2012 statement reappears in the recent company statement except Bridgelux is omitted from the text. Please see the table below for a comparison of similar statements in the two press releases.
As an important member of the Chinese electronic industry Kaifa has invested in many financial projects, if successful this could be one of the most important LED mergers in China.
